ACGF Chairman Says Petroleum Industry is
Duplicitous by Misleading Congress and Consumers about RFS and
Ethanol -Apparently Attempting to Seize Back
Monopoly Market Power over the Consumer Gasoline Market(printable copy)

July 19, 2013
By Gale Lush, Chairman

WILCOX, NEB –July 19, 2013 – “Recent attacks on the Renewable
Fuel Standard (RFS) by the American Petroleum Institute (API)
are misleading the United States Congress and American
consumers,” said Gale Lush, Chairman of the American Corn
Growers Foundation (ACGF), a corn, soybean and wheat farmer from
Wilcox, Nebraska. “Considering that the fossil fuel industry has
had one hundred years of various forms of government support and
subsidies including tax credits through which they avoid paying
federal taxes, it’s about the same as oil companies getting the
equivalent of checks from the federal government and U.S.
taxpayers, just in a little different form. Government support,
combined with their dominance of motor fuels has amounted to a
“mandate” and a captive market for their product, namely
gasoline. The API’s call for the elimination of the RFS for
ethanol is duplicitous at best and shows a selfish disregard for
the best interests of the U.S. economy, U.S. consumers and U.S.
energy security given that ethanol keeps gas prices $1.09 per
gallon less at the pump than those prices otherwise would be
without ethanol in the gasoline pipeline, according to a recent
study by Iowa State University. It appears the petroleum
industry wants to seize back monopoly market power which could
result in a 100 percent oil industry monopoly “mandate” in the
U.S. gasoline market if they could replace clean burning,
environmentally-friendly ethanol with strictly gasoline,
including all its carcinogens such as benzene.”

Lush added that the July 2013 U.S. Department of Agriculture
(USDA) supply and demand report shows a near record number of
acres planted to corn and near record 2013 corn production
projected at about 14 billion bushels, plenty of corn for feed
and fuel. Average corn prices are projected to drop by about
$2.00 per bushel for the 2013/2014 marketing year.

“The API and big agribusiness livestock trade groups are trying
to mislead the public and Congress with their spin that corn use
for ethanol is a question of corn for fuel versus corn for food
but that is disingenuous given the realities of the actual share
of yellow field corn that traditionally goes to cereals and
other products. According to USDA only 210 million bushels of
corn is used in the category of ‘Cereals and other products’,
270 million bushels goes for ‘Glucose and dextrose’, 250 million
bushels goes for ‘Starch’, and 505 million bushels goes for
‘High-fructose corn syrup (HFCS),” said Lush. “Furthermore, USDA
projects that total U.S. red meat and poultry production in 2013
will be over 93 billion pounds with per capita U.S. consumption
rising from 202.2 pounds in 2012 to 204.8 pounds in 2014.
Obviously, there is no shortage of either corn or meat in the
U.S. marketplace, so the API and those other anti-ethanol trade
groups should knock off their misinformation campaign and back
off their attempts at trying to get Congress to repeal the RFS.”

“Only the starch from the corn kernel goes toward producing
ethanol,” said Lush. “The minerals, protein, oil, wet or dried
distillers grain (DDGS) still goes right into the livestock
feeding sector to produce meat for U.S. consumers while each
bushel of corn simultaneously provides consumers nearly three
gallons of ethanol that is blended with gasoline, keeping
gasoline prices about $1.09 per gallon less at the gas pump, a
major economic benefit for U.S. consumers and motorists. It
appears that the petroleum industry wants to dominate government
policy to have monopoly power in the gasoline market, and
history shows just how much they are able to gouge consumers
without fuel supply competition from ethanol.”

“For many years, as a landowner and farmer I have cooperated
with the fossil fuel industry, by allowing them to use my
production platform (my farmland) for multiple pipelines, so oil
and gas companies can deliver their products (petroleum and
natural gas) to the market,” said Lush. “Why shouldn’t I expect
the petroleum industry to extend me the same courtesy and
cooperation by allowing my product (corn ethanol) to be
delivered through their marketing platform (gasoline outlets and
stations) to American motorists and consumers? Farmers and the
ethanol industry are providing a valuable, high quality product
to consumers while enhancing U.S. energy security. With ethanol
plants widely dispersed across the U.S. Middle West foreign wars
in the Middle East and elsewhere do not jeopardize that part of
our domestic fuel supply. This is not about an either or
situation of corn for food or for fuel because prior to ethanol
use yellow field corn was primarily used for livestock feed, not
human consumption. The valuable feed corn components still are
going into the livestock feeding industry that provides an
abundance of food to consumers in the U.S. and around the world.
It’s high time for the petroleum industry to become our American
ally and marketing partner instead of our opponent.”